Stocks to Watch on Budget Day: As February 1st marks an important day for the Indian stock market, with the Union Budget being announced, it is also a day for traders to closely monitor the stocks making waves in the market. Today, several companies are in focus due to their quarterly earnings reports, new announcements, or major business deals. Among the key stocks to watch are Tata Power, ONGC, Waaree Energies, Sun Pharma, IndusInd Bank, Vishal Mega Mart, and Poonawalla Fincorp.
1. Tata Power: A Bright Future Ahead with Rooftop Solar Expansion
Tata Power, a prominent player in the energy sector, is all set to capture market attention with its recent strategic move. The company’s subsidiary, Tata Power Renewable Energy, has signed a Memorandum of Understanding (MoU) with Rajasthan’s distribution companies, including Jaipur Vidyut Vitran Nigam, Ajmer Vidyut Vitran Nigam, and Jodhpur Vidyut Vitran Nigam, to accelerate rooftop solar adoption across Rajasthan. This initiative is a step forward in enhancing clean energy solutions and contributes significantly to the company’s growth prospects.
Key Financial Ratios (as of Q3 FY2025):
- P/E Ratio: 27.8
- Debt to Equity Ratio: 1.12
- EPS: Rs 4.50
- Return on Equity: 14.3%
The government’s focus on renewable energy and solar power will be critical for the stock’s future, especially with the upcoming budget that could further incentivize green energy solutions.
2. Oil and Natural Gas Corporation (ONGC): Profit Slumps Amid Challenging Times
ONGC, one of the largest oil and gas exploration companies in India, will see its stock movement closely tracked after reporting a 31.2% drop in its Q3 profit to Rs 8,239.9 crore. While the company’s revenue fell slightly by 0.5% to Rs 33,716.8 crore, ONGC declared an interim dividend of Rs 5 per share, which could provide some comfort to investors. Despite this, concerns over falling profit and revenue figures might weigh on market sentiment.
Key Financial Ratios:
- P/E Ratio: 7.6
- Debt to Equity Ratio: 0.34
- EPS: Rs 16.10
- Dividend Yield: 4.3%
The stock’s performance will be influenced by global oil prices and any announcements related to the government’s support for the oil and gas industry in the upcoming budget.
3. Waaree Energies: A Key Player in Green Hydrogen Production
Waaree Energies is making headlines with its subsidiary, Waaree Clean Energy Solutions, receiving a Notification of Award (NoA) from the Solar Energy Corporation of India. The company will be setting up a 90,000 MT per annum production facility for green hydrogen in India. This development will be closely watched by investors, as green hydrogen is expected to play a pivotal role in India’s energy transition.
Key Financial Ratios:
- P/E Ratio: 15.4
- Debt to Equity Ratio: 0.98
- EPS: Rs 7.35
- Return on Equity: 18.2%
The government’s stance on hydrogen energy in the budget could further accelerate the company’s growth prospects.
4. Sun Pharmaceutical Industries: Consistent Performance and Strong Growth
Sun Pharma, one of India’s leading pharmaceutical companies, has reported 15% growth in profit to Rs 2,903.4 crore, while revenue increased 10.5% to Rs 13,675.5 crore in Q3. Despite the challenges faced by the pharmaceutical industry globally, Sun Pharma continues to post solid results. The company’s robust performance is a reflection of strong demand in both domestic and international markets.
Key Financial Ratios:
- P/E Ratio: 31.9
- Debt to Equity Ratio: 0.05
- EPS: Rs 19.20
- Return on Equity: 28.4%
Investors are likely to continue favoring Sun Pharma as a safe bet, especially with the budget’s potential focus on healthcare and the pharmaceutical sector.
5. IndusInd Bank: Profit Declines Amid Increased Provisions
IndusInd Bank is facing a tough quarter with 39% decline in profit to Rs 1,401.3 crore and a slight dip in Net Interest Income (NII) by 1.3% to Rs 5,228.1 crore. The bank’s provisions and contingencies increased significantly, indicating a cautious approach towards potential risks. Additionally, the Gross NPA and Net NPA figures showed a slight rise, adding to concerns about asset quality.
Key Financial Ratios:
- P/E Ratio: 14.3
- Debt to Equity Ratio: 0.90
- EPS: Rs 23.12
- Net NPA: 0.68%
Given these developments, traders should monitor any regulatory changes or government announcements regarding the banking sector in the upcoming budget, which could impact the stock’s performance.
6. Vishal Mega Mart: A Retailer on the Rise
Vishal Mega Mart has surprised investors with an impressive 28% growth in profit to Rs 262.7 crore, while revenue rose 19.5% to Rs 3,135.9 crore. The company has been performing strongly due to its solid retail model and increasing demand in the consumer sector. With the Union Budget 2025 expected to focus on boosting consumption, Vishal Mega Mart could see sustained growth.
Key Financial Ratios:
- P/E Ratio: 20.4
- Debt to Equity Ratio: 0.29
- EPS: Rs 12.08
- Return on Equity: 22.1%
Investors might see Vishal Mega Mart as a growth stock, especially with increased government focus on retail and consumer spending.
7. Poonawalla Fincorp: Decline in Profit Due to Impairment Charges
Poonawalla Fincorp has seen a massive 92.9% drop in profit to Rs 18.7 crore, mainly due to higher impairment charges. However, the company’s Net Interest Income grew by 22.2% to Rs 672 crore. Investors will be focused on how the company handles the impairment and whether the stock can recover.
Key Financial Ratios:
- P/E Ratio: 7.3
- Debt to Equity Ratio: 3.12
- EPS: Rs 0.60
- Return on Equity: 4.7%
The upcoming budget could provide further clarity on the financial sector’s growth, and Poonawalla Fincorp could benefit if there are any announcements favoring financial institutions.
Conclusion
With the Union Budget announcements expected to drive market sentiment, stocks like Tata Power, ONGC, Waaree Energies, Sun Pharma, IndusInd Bank, Vishal Mega Mart, and Poonawalla Fincorp are likely to be in the spotlight. Traders and investors alike should keep an eye on these companies’ quarterly results and any potential government initiatives in the budget that could further influence their growth.
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Disclaimer: This blog post is for informational purposes only and should not be considered financial advice. Investors should conduct thorough research and consult with a qualified financial advisor before making any investment decisions.